Monthly Summary: The market price of bearing steel may fluctuate and consolidate in June

Monthly Summary: The market price of bearing steel may fluctuate and consolidate in June

Overview: From January to April 2023, the domestic production of bearing steel crude steel decreased by 1.67% year-on-year, and the output of bearing steel decreased by 4.05% year-on-year. Looking back at the market in May, the domestic bearing steel market price is showing a trend of bottoming out, and the willingness of terminal purchases is not strong. Up to now, the average price of domestic bearing round steel 50mm (continuous casting) is 5,069 yuan/ton, a decrease of 325 yuan/ton from the end of April, and a month-on-month decrease of 6.03%. It is expected that the market price of bearing steel in June may show a weak consolidation pattern.

1. Domestic production of bearing steel

(1) Production of bearing steel from January to April 2023: Both steel and crude steel decreased year-on-year

According to statistics from the Special Steel Association, from January to April 2023, the output of bearing steel crude steel of my country's major high-quality special steel enterprises was 1.6354 million tons, a decrease of 1.67% compared with the same period last year; from January to April 2023, the output of bearing steel of my country's major high-quality special steel enterprises was 1.4164 million tons, a decrease of 4.05% compared with the same period last year.

(2) The output of finished products of bearing steel manufacturers from January to April 2023: the output of steel mills decreased year-on-year

It can be seen that the current production enterprises with large bearing steel production are: CITIC Special Steel (Xingcheng Special Steel, Daye Special Steel, Qingdao Iron and Steel), Jiyuan Iron and Steel and Shigang, accounting for 57% of the total output. From January to April 2023, the overall output of bearing steel is decreasing. The output of Juneng, Jiyuan, Benxi Iron and Steel, Xinggang, Zhongtian and other steel mills has increased slightly compared with the same period last year, and the output of Beiman, Yonggang, Zhongte, Dongte, Shigang, Nangang and other steel mills has decreased.

2. Domestic bearing steel market performance

The bearing steel market continued to fall in May, and the market sentiment was weak. In an environment where prices continued to fall, market confidence was lacking, traders adjusted their inventory structure, and both actual and speculative demand in the market were weak. It is expected that the market price of bearing steel in June may show a weak consolidation pattern.

3. Relevant market information

(1) Raw material prices:

The price of iron ore fell after a surge in May, and the current 62% Australian powder index is 103.65 US dollars/dry ton. It is expected that the price trend of iron ore in June may show a trend of rising first and then falling, and the decline will be greater than the increase in the first ten days. The market price of scrap steel moved down a step again, and the supply and demand showed a simultaneous decline. The current average price of scrap steel is 2389 yuan/ton. Considering that the current macro environment is unstable and the bottom of the scrap steel market may not yet be firmly established, it is expected that the scrap steel price may fluctuate repeatedly in June, but the overall trend will continue downward, but the overall decline may continue to narrow month-on-month. The market price of high-carbon ferrochromium fluctuated strongly, and the price at the end of the month was 9077 yuan/ton.

(2) Downstream industries:

According to the statistical analysis of the China Association of Automobile Manufacturers, in April 2023, the production and sales of automobiles will be 2.133 million and 2.159 million respectively, a year-on-year increase of 76.8% and 82.7% respectively. New energy vehicles continued to perform well, with a steady increase in market share. In April, the production and sales of new energy vehicles reached 640,000 and 636,000 respectively, a year-on-year increase of 1.1 times, and the market share reached 29.5%. In terms of automobile exports, 376,000 automobiles were exported, a year-on-year increase of 1.7 times. my country's economic operation has shown recovery and improvement, and the task of stabilizing the growth of the automobile industry is still heavy. It is necessary to continue to boost effective policies to stabilize and expand automobile consumption, fully promote the release of the potential of automobile consumption, and promote the stable operation of the automobile industry.

4. Conclusion

In May, the market price of bearing steel continued to drop, and the market demand was still in the doldrums. It is expected that the market price of bearing steel may show a weak consolidation pattern in June.